ANUPAM CO- OPERATIVE HOUSING SOCIETY,PUNE vs. INCOME TAX OFFICER, WARD-12(1), PUNE, PUNE

These two appeals relate to the assessment years 2017-18 and 2020-21. Since a common issue is raised in these appeals, I am therefore, proceeding to dispose of these appeals by this consolidated order for the sake of convenience.

Briefly stated, the facts for the A.Y. 2017-18, are that the assessee, a cooperative housing society, earned interest income from the deposits with cooperative societies which was claimed as deductible u/s.80P. The Centralised Processing Centre (CPC) processed the return u/s.143(3) and did not allow the deduction. The ld. CIT(A) upheld the intimation denying the benefit u/s.80P, against which the assessee has approached the Tribunal.

After considering the rival submissions and perusing the relevant material on record, it is seen that the assessee is a co- operative society and earned interest income amounting to Rs.8,53,542/- from the deposits kept with Pune District Co-operative Bank and Saraswat Bank. The question of allowing deduction u/s 80P on this score is no more res integra in view of the catena of decisions delivered by the Pune Benches, including the Rena Sahakari Sakhar Karkhana Ltd. Vs. Pr.CIT (ITA No.1249/PUN/2018) holding, vide its order dated 07-01-2022, that though co-operative banks, other than primary agricultural credit society or a primary co-operative agricultural and rural development bank, are not eligible for deduction pursuant to insertion of section 80P(4) w.e.f. 1.4.2007, but this provision does not dent the otherwise eligibility u/s 80P(2)(d) of the Act of a co-operative society on interest income on investments/deposits parked with a co-operative bank, which is a registered co-operative society as per section 2(19) of the Act, defining co-operative society to mean a co-operative society registered under the Co-operative Societies Act, 1912 or under any law for the time being in force. The payer of interest is also a Co-operative society registered under the Cooperative Societies Act. Respectfully following the decision of the Division Bench, I overturn the impugned order and direct to grant deduction u/s.80P(2)(d) of the Act on the amount of interest earned from cooperative banks.

During the year under consideration, the assessee claimed deduction of interest income amounting to Rs.8,27,393/- and dividend of Rs.293/- u/s.80P of the Act. The CPC denied the deduction the same even in the rectification order u/s.154 of the Act, which came to be affirmed in the first appeal. Both the sides are in agreement that the facts and circumstances for the A.Y. 2020-21 are mutatis mutandis similar. Following the view taken hereinabove for the A.Y. 2017-18, I overturn the impugned order and direct to grant deduction u/s.80P(2)(d) in respect of the interest and dividend income.

In the result, both the appeals are allowed. Order pronounced in the Open Court on 09th June, 2023.